Chen Yongqing, Chairman of Guoxin Pharma: Deepening the Pharmaceutical Innovation Ecosystem and Embracing the 'Lotus Law' for Long-Term Growth
Source: Economic Daily
A lotus pond had only a small portion of its lotus flowers blooming on the first day. On the second day, the number of blooms doubled compared to the previously opened flowers. By the 30th day, the entire pond was covered in blossoms. Do you know on which day half of the lotus flowers were in bloom?
“Many people assume it is the 15th day, but in fact, it is the 29th day! This is because the early stage focuses on root development and laying a foundation, with growth accelerating over time.” Recently, Dr. Chen Yongqing, Chairman of Guoxin Pharmaceutical Group, stated in an exclusive interview with reporters from Economic Daily-China Economic Net that the company’s development mirrors the “Lotus Law,” emphasizing steady progress and accumulating strength for future breakthroughs. Within Guoxin Pharmaceutical’s long-term planning and strategy, its original aspiration remains unwavering: to be rooted in China’s pharmaceutical innovation ecosystem, help enterprises develop more innovative products, explore the clinical characteristics of marketed products, continuously cultivate product value, and support the pharmaceutical industry in becoming larger and stronger.
CRO (Contract Research Organization) is a contract research organization, referring to an academic or commercial scientific institution that provides specialized services to pharmaceutical companies and R&D institutions during the drug development process through contractual agreements. Based on business scope, CROs can be categorized into drug discovery, preclinical drug research, preclinical studies, and clinical research. According to Frost & Sullivan’s survey results, the clinical research market is the largest, with the market share distribution for drug discovery, preclinical research, and clinical research being approximately 20%:14%:66%.
Since graduating from university, Chen Yongqing has dedicated himself to new drug R&D, accumulating 17 years of industry experience. In 2008, he founded Guoxin Pharmaceutical, where he currently serves as Founder and Chairman. The development trajectory of Guoxin Pharmaceutical bears the distinct imprint of Chen’s philosophy: staying grounded, building strength through steady accumulation, and pursuing dreams with determination.
“2008 coincided with a transformative period for the entire CRO industry. At that time, the pharmaceutical landscape was transitioning from disorder to order, with many drug candidates beginning to demonstrate clinical demand and facing increasingly stringent requirements. Sensing that the CRO sector was poised to reach a new level, I decided to embark on my own entrepreneurial journey,” Chen Yongqing told reporters. Driven by favorable macroeconomic conditions and high expectations for the CRO industry, he resigned from his then-current R&D company in 2008 and co-founded Guoxin Medicine with his partner, Wang Yuehong.
“At the beginning, the company was small in scale and lacked experience; the journey from zero to one was actually quite painful.” Recounting the entrepreneurial process, Chen Yongqing remarked that while starting a business is no easy feat, the achievements have been considerable. He explained that throughout their journey—from initial limitations in scale and experience, to the loss of key talent midway, and then to the industry’s downturn—despite numerous setbacks, “persistence,” “focus,” and “dedication” have remained the company’s core guiding principles.
“There were countless temptations and difficult moments along the way, but we ultimately persevered, growing ever more deeply committed to this industry,” he explained. Turbulence in the industry landscape, turnover of key team talent, and expansion of corporate business operations are all challenges directly faced in entrepreneurship. However, as long as a company remains sufficiently persistent, focused, and dedicated, problems will be readily resolved.
After more than a decade of persistence and dedication, Guoxin Medicine now boasts seven subsidiaries, 23 offices, and three overseas branches, with a workforce of nearly 500 employees. The company has established in-depth collaborations with over 900 Grade A tertiary hospitals, more than 600 clinical research institutions, and upwards of 160 pharmaceutical enterprises across China. Having completed more than 380 clinical trials to date, Guoxin Medicine is the fastest-growing CRO company in China over the past five years, with a compound annual growth rate exceeding 70%.
“Guoxin Pharmaceutical’s culture is open and inclusive, with strong capacity for integration.” In Chen Yongqing’s view, the company’s impressive achievements are positively correlated with its open corporate culture and forward-looking strategic layout. Thanks to its inclusiveness, Guoxin Pharmaceutical has attracted high-caliber talent, including numerous overseas-returnee scientists and seasoned experts, fostering vibrant scientific research collaboration. Owing to its openness, partners have brought in many repeat clients, earning the company favorable market recognition.
Discussing future strategic planning, Chen Yongqing spoke at length: “Digitalization is a central thread in our company’s layout and development. First, we are comprehensively systematizing the management of our corporate teams; for instance, we employ systems such as CTMS, EDC, IWRS, eTMF, and eCTD to achieve systematic, end-to-end control over R&D projects. Second, digitalization also encompasses marketing management, including promotional activities, market outreach, and business development, all of which we are driving toward digital transformation. Finally, digitalization involves data volume, with the company shifting its focus toward medical big data.”
Chen Yongqing believes that building a biomedical ecosystem is one of the current pain points in the industry, as well as a future development trend. Currently, although the entire industry emphasizes digitalization and systematization, data silos remain a persistent problem, and redundant work still exists. In the future, Guoxin Medicine will implement digital management from multiple aspects, including platform development, corporate structure, business philosophy, and market promotion.
Guoxin Pharma’s business scope is continuously expanding, encompassing three core segments: clinical research on innovative drugs, post-marketing studies, and clinical trials for vaccines. Its expertise spans multiple therapeutic areas, including cardiovascular diseases, oncology, orthopedics, gastroenterology, antiviral therapies, antibiotics, endocrinology, neuropsychiatry, pediatrics, gynecology, urology, ophthalmology, and dermatology.
In Chen Yongqing’s view, for innovative drug companies, completing registrational clinical trials and achieving successful market launch is merely the first step in a long march; they must still navigate the arduous journey of post-marketing clinical research. As China’s National Reimbursement Drug List (NRDL) enters an era of dynamic adjustments, cost-effectiveness and therapeutic value have become the sole criteria for clinical use under the new policy framework. These factors also serve as the foundation for reimbursement, the key to market access, and the driving force behind physicians’ prescribing decisions. The key to achieving differentiated efficacy and driving product marketing lies in generating new clinical evidence, clarifying new clinical positioning, elucidating new clinical value, and identifying new target patient populations after market launch. “Guoxin Pharma will leverage clinical research focused on uncovering drug value to help enterprises build a ‘moat’ for their pharmaceutical marketing strategies,” stated Chen Yongqing.
Guoxin Pharma is also actively contributing its strength to the development of the CRO industry. Chen Yongqing introduced that in September 2020, Guoxin Pharma was elected as the Executive Vice-Chairman Unit of the CRO Branch of the China Pharmaceutical Quality Management Association. In the future, the company will join hands with numerous peer member enterprises to jointly foster a well-regulated and orderly market environment for pharmaceutical R&D.
Data shows that from 2015 to 2019, the market size of China's pharmaceutical CRO industry was RMB 35 billion, RMB 46.2 billion, RMB 55.9 billion, RMB 60 billion, and RMB 78 billion, respectively, and is expected to exceed RMB 100 billion this year.
In October 2020, Guoxin Pharma completed its first round of capital increase from institutional investors, amounting to nearly RMB 100 million. Investors in this round included Yinyi Medical Capital, a well-known domestic healthcare investment fund, as well as industrial funds affiliated with several leading listed companies in the industry. Notably, Yinyi Medical Capital was the Series A investor in Genetron Health, a prominent listed company, and has successfully invested in multiple high-profile projects in the medical and pharmaceutical sectors.
“This round of financing is crucial. Amid the sudden outbreak of the pandemic in 2020, securing such a substantial amount of capital has enabled us to accelerate our growth,” said Chen Yongqing. He noted that despite the adverse impacts brought by the pandemic, the company’s business continued to grow this year. He stated that this financing further drove the expansion of the company’s scale. In the future, Guoxin Medicine will not only recruit high-end talent and establish large-scale offices and subsidiaries in multiple regions, but also engage in vaccine research, cell therapy, and digital eCRO services for medical big data, while simultaneously expanding into international markets.
Looking ahead, Chen Yongqing stated that the biopharmaceutical sector is both a sunrise industry and a high-growth frontier. Currently, Guoxin Pharmaceutical is transitioning from large-scale operations to even larger-scale expansion. With an eye toward the future, the company will advance its innovative drugs, post-launch value cultivation, and vaccine businesses in tandem, while continuously strengthening its talent pipeline and accelerating its internationalization process.
“We aim to achieve a main board IPO within the next three years, building a large-scale clinical CRO that meets international standards and embraces a global perspective,” added Chen Yongqing, his eyes reflecting determination and confidence.